The Baby Boomers Retirement Blog

Trying to figure out how to live on a retirement income is a worthwhile exercise, yet many people overlook some possible money traps. The things we don’t always think of can have an impact on our finances. As you will see, these things are never more important than they are during retirement.

Travel. While ‘travel’ is mentioned specifically, it really refers to anything we’d like to do for fun. You’ve already paid your dues working for a boss, now is your chance to do the things you always wanted to do. But that fun can add up, so be sure to figure it into your calculations.

Health concerns. Not to sound depressing, but aging is a slow deterioration of the cells in the body. This also means that many ailments may start to appear, and eat away at our savings. Preventative measures can, and should, be taken, but there is still no guarantee you won’t experience some health concerns as you get older.

Nursing home. Though you may be close to retirement and not ready for the “old-folk’s home” quite yet, at some point you will be considering your options. Before you do, take a trip to a private nursing facility, then go to a state or county run one. A big difference in quality is normal, but you will have to decide if a privately run facility is worth the extra cost.

Inflation. Because they get raises, most people simply don’t notice inflation when they are working for a living. But when you’re on a fixed income, inflation has a more noticeable impact on your buying power. In other words, prices go up, but your income doesn’t. Even with your best guess, the rate of inflation varies, so it can be difficult to plan for it accurately.

Savings. As retirement gets closer, people will start to contribute more to their savings or investments to shore up their reserves. However, many savings are tied to financial markets, and when those markets suffer, savings may dwindle. For younger people it doesn’t matter as much, but when retirement is right around the corner any hit to your savings can be scary.

Those are just a few of the money traps that can effect your retirement income. After reading this article you may be wondering what you can do. First, do your best to be realistic and plan for the worst-case scenario (better to have too much than not enough). Next, you can educate yourself about pension and retirement income. Finally, look at ways to increase how much money you have coming in at any given moment. Doing so can make the difference between wasting away or having the time of your life.

About the author

Istvan Horvath is an author, blogger, former journalist, a passionate advocate of the Baby Boomers, and the founder of DigitalPensionCom. He is writing extensively about the Baby Boomers' retirement and pension issues. His Pension Report is an eye-opener. Visit his Baby Boomer Pension Blog for more articles. This article can be reprinted or republished provided the content and links are left intact, and the "about the author" section is included.